Dr. Ilse Andrea Ennsfellner CMC® CSE
Professional standards and ethics shaping the future of the consulting profession while helping to accommodate the changes brought about by powerful global drivers were the subject of an online discussion on 14 July 2022 as part of the ICMCI Future of Management Consultancy initiative. The panellists included Dr. Ilse Andrea Ennsfellner CMC CSE, Anis Jabsheh CMC and Balazs Mezosi CMC. The conversation was moderated by Celal Seçkin CMC, ICMCI Professional Standards Committee Chair.
Dr. Ilse Andrea Ennsfellner CMC CSE focused on the standards in the practice of management consultancy and on appropriate stakeholder engagement to ensure successful delivery.
The standard ISO 20700:2017 Guidelines for management consultancy emphasises that the management consultancy industry makes a substantial contribution to the world economy and it is this impact that has prompted stakeholders to call for a standard in the profession. Furthermore, ISO 20700:2017 states that management consultants deal with important issues and support clients in handling complexity, achieving sustainable organisational growth, innovating, implementing change and enhancing productivity. All these fundamental processes in which management consultants are involved are indicative of the power of the management consultancy profession.
The market and its structure also make standards relevant. The consulting market is dominated by the Big 4 consultancy organisations. According to estimates, the top 200 consultancies in the world hold 80% of the market. Those top 200 consultancies in the world have their internal standards, processes and knowledge management systems. At the other side of the spectrum are the smaller consultancies. They usually need to focus on the technical aspects and the procedural experience and they thus do not have time to establish all their own processes professionally and sustainably. This is why ISO 20700:2017 is important to those organisations especially.
Clients are another driving force in the development of standards. ISO, the International Standards Organisation, was founded 75 years ago. In this time, ISO has published more than 23,000 standards. Consultants are affected by these standards and this is formulated in ISO 20700:2017 as well in the principle that consultants should maintain an appropriate level of awareness of relevant laws, policies, rules, regulations and standards that govern their services and those of the clients.
To ensure appropriate project setup and delivery, consultants need to specify the relevant laws, regulations and standards in their agreements with clients.
In terms of the standards applied in management consultancy, four distinct strata emerge:
- Level 1: Consultants, or the consultants’ competence. Applicable here are the CMC qualification and other national and international certifications and accreditations.
- Level 2: Relationship with clients, or how consultants handle and manage client projects. Applicable is ISO 20700:2017.
- Level 3: Organisational governance, or how consultants manage their own organisations. In this respect, firms usually adhere to standards such as ISO 9001 which may prove to be irrelevant to consulting organisations. ISO 20700:2017 gives a background for a process model for a consulting organisation.
Level 4: The profession, or how consultants interact with colleagues and professional associations. Two dimensions need to be covered:
- Code of Ethical and Professional Conduct, as required by ISO 20700:2017, to be observed and laid down in the agreement with the client. The Code of Conduct is to include professional behaviour, sustainability, social responsibility, integrity, respect for the profession.
- Confidentiality agreement, also to be included in the agreement with the client, as the consultant is responsible for handing the data and information received.
To ensure appropriate delivery, ISO 20700:2017 specifically deals with stakeholder engagement. Thus, ISO 20700:2017 requires of consultants to achieve socially responsible outcomes that consider the interest of stakeholders in order to contribute to sustainable development and ethical project governance. Therefore, consultants need to perform a profound stakeholder analysis, to agree on their involvement and to assess risks.
However, stakeholder engagement requires resources while social responsibility is a big investment. Consultants are thus faced with a dilemma: the need to win a consulting assignment vs. the consultants’ financial advantage.
Thus, stakeholder engagement requires engagement with the client. Consultants need to talk to their clients and make sure that they understand the economic situation and the restrictions it entails. Therefore, stakeholder engagement has very much to do with the communication between the client and the consultant.
On the other hand, even though ISO 20700:2017 is written from the perspective of management consultancy, it gives an outline of the role of clients in consultancy projects as well. It defines clearly the responsibility of consultants and the responsibility of clients in assignments. Consultants are responsible for their resources and work; they have the intellectual property rights for their know-how, methodologies, data bases, benchmarks, concepts and techniques. However, the ultimate responsibility for decisions, outcomes and deliverables lies with the client. The client is the one to take a decision, unless defined otherwise in the agreement.
There are more responsibilities that consultants should expect of clients such as to select the consultant, to understand the need to share all relevant and significant information, to understand the need to provide human resources, to assign roles and responsibilities.
In terms of the future of management consultancy, a new trend is emerging and the roles and the cooperation between clients and consultants will change and even merge. For example, as a result of digitalisation clients can now take over more aspects of an assignment, using their own resources to analyse or implement projects. This means that new collaboration models can be expected between consultants and customers. The boundaries between self-consulting – by clients themselves, between internal consulting units and external consulting – are merging. In the future, one could expect more teams from internal employees and external consultants increasingly working together on projects to achieve the defined results.
The new role of the consultant could be that of a partner in decision-making, supporting implementation or development of in-house client capabilities, or even going as far as business foundations with equity investment of the consultant in the client organisation. In the future, consultants and clients will together in a new intelligent cooperation.
The matter of the identity of consultants in today’s world is also essential. Consultants acquire identity not only through projects but also through membership in professional associations, like the ICMCI member institutes, as well as through adhering to standards which provide a common agreement.
Furthermore, standards are a means of quality assurance. No profession can develop without standards and having a standard means the next step in the development and the improvement of the profession.
For more from Dr. Ilse Andrea Ennsfellner CMC® CSE, please check out this video
For more highlights of the event, please visit the ICMCI YouTube channel
About Dr. Ilse Andrea Ennsfellner CMC® CSE
Dr. Ilse Andrea Ennsfellner CMC® CSE has more than 25 years of experience as a management consultant, trainer and mediator. She specialises in quality management, process and project management, business mediation, cultural relations management and systemic management consultancy. She has occupied leading positions in consulting associations such as ICMCI and the Austrian Professional Association of Management Consultancy, Accounting and IT. She was also engaged in the development and promotion of ISO 20700:2017: Guidelines for management consultancy services.
About the Future of Management Consultancy
Combining a series of events, discussions and publications, the ICMCI Future of Management Consultancy initiative strives to promote the global conversation about the future of the profession towards developing a common vision to help and inspire consultants all over the world.
Designed as an “open source” and inclusive platform, the Future of Management Consultancy is an opportunity to seek answers to pressing questions and to encourage interactive communication and joint idea generation.